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Recently, Thomas Lyon wrote a rebuttal to one of my posts on the proliferation of ecolabels, in which he argues that ecolabel competition and non-NGO labels lead to increased environmental damage.
In my original post, I pointed out that competition and the consolidation of ecolabels will lead to less confusion and better certification programs. But Thomas brings up a point that I did not discuss in my original post: The performance of ecolabels and what type of labeling ecosystem maximizes performance.
First, it is important to define what I mean by performance. Very simply, I am referring to the total net environmental (or health or social) benefit that occurs as a result of an ecolabel in the market. Thomas points out that NGO labels tend to be more stringent and set a higher bar than industry-led or for-profit labels. However, what I don't agree with, is that this always leads to maximized performance.
Let me give a hypothetical example. An ecolabel creates a very difficult standard that really moves the needle for companies if they can meet the requirements. Let's say the net impact reduction is 80 (in whatever units you like) for every label that is achieved. But because the standard is so difficult to achieve and so costly for companies to change their practices to comply with the requirements, over time only five companies are able to be issued the label. This results in a net impact reduction of 400.
Then a competing label comes along and they create a standard that is not as stringent, but still has a net impact reduction of 40 for every label that is achieved. However, this standard is a bit easier and cheaper for companies to achieve, so many more companies are inspired to attempt to achieve it. Over time, 20 companies are issued the label for a net impact reduction of 800.
As you see, in the end, the total net benefit is greater when a label gains more acceptance, even when the standard isn't as stringent. It's a matter of taking many more small steps instead of taking a few very large steps.
I am not advocating to create watered down, easy-to-achieve standards, but it is important to create a balance of something that does lead to reduced impacts and can gain wide acceptance in the market. There are two reasons for this.
Chris raises an important
Chris raises an important point about ecolabels with multiple levels of achievement, and I'm surprised you don't suggest multiple levels as a step for maximizing an ecolabel's impact. Having multiple levels seems like a better solution to the issue you identify than having a less stringent label with only one level. Ecolabels with multiple level can have a lower level that is accessible to a large number of entities as well as higher levels that participants can work towards over time. This means entities at all levels can participate and be recognized for what they are doing. They are also provided with an incentive to improve their performance so as to move up over time. As a result, standards with multiple levels seem much more likely to generate more continuous improvement over time than the binary standards you are discussing.
Additionally, I think you are seriously underestimating the importance of having the leading companies/products participate in an ecolabel program. A primary goal of many ecolabels is to shift the market and enable consumers to buy the greenest products. An ecolabel that rewards moderately green products but not the greenest products could be actually counter-productive if consumers switch from the truly greenest products to the ones certified at the modest standard.
Likewise, other common goals of ecolabel programs are to stimulate positive competition among participants and to help participants learn from each other. Not having the true leaders participate in the ecolabel limits the benefits of achieving these goals since participants won't be able to learn from or or benchmark their performance against the leaders.
Question: How does this
Question: How does this debate, if at all, fit with the imminent guidelines from the FTC on greenwashing?
No need for low bar standards, take incremental approach
Companies can already choose from a range of certifications that differ in breadth, depth and rigor. Within some of the standards perceived to be among the more rigorous, companies also have the option to start small and scale up. There's no need to water down standards, create lower bar ones or retain the low bar options that exist. Recognizing companies for doing little more than the status quo is also misleading to buyers and doesn't drive the change needed to address social and environmental issues.
First, companies can choose to certify only some of their products and services versus their full line. If a business can't make one product or service meet a rigorous standard, they don't deserve that recognition. Many electronics and appliance companies offer just a few energy star options, for example, and many food companies offer only one line or a few items that are organic, fair trade labeled, etc.
Additionally, many certifications allow for different levels. LEED has bronze through platinum. Certified Organic has 70% (made with), 95%+ (USDA Organic) and 100% (100% organic). Rainforest Alliance allows companies to obtain their label for a blend starting with as little as 30% Rainforest Alliance sourced product - which would ideally be scaled to 100%.
Standards should be set at a high bar that requires real change and commitment. Companies have the option to determine how many products and services they're willing to get up to snuff, representing their overall support for the standards and real results.